Utility Week

UTILITY WEEK | 14TH - 20TH SEPTEMBER 2018 | 3 This week 4 | Seven days 6 | News Ofgem's price cap on domestic energy prices 8 | Interview Alan Whitehead MP, shadow energy minister 12 Policy & Regulation 12 | News Ofwat begins scrutiny of business plans 13 | Analysis Water companies submit their final business plans for PR19 14 | Analysis The balancing mechanism opens up to small generators 17 | Chief executive's view Wilfrid Petrie, Engie UK & Ireland 19 Finance & Investment 19 | News BEIS awards funding for AMR research 20 Operations & Assets 20 | High viz Southern Water's Peacehaven wastewater treatment works 22 | Insight report Exclusive research by Wipro and Utility Week into utilities' attitudes to innovation 27 Customers 27 | News Bulb announces third price rise this year 29 | Opinion Daniel Brown, policy manager, Renewable Energy Association 30 Community 31 | Disconnector GAS 6 | News Ofgem's price cap on domestic energy prices WATER 12 | News Ofwat begins scrutiny of business plans 13 | Analysis Water companies submit their final business plans for PR19 20 | High viz Southern Water's Peacehaven wastewater treatment works ELECTRICITY 14 | Analysis The balancing mechanism opens up to small generators 19 | News BEIS awards funding for AMR research 29 | Opinion Daniel Brown, policy manager, Renewable Energy Association ENERGY 8 | Interview Alan Whitehead MP, shadow energy minister 17 | Chief executive's view Wilfrid Petrie, Engie UK & Ireland 22 | Insight report Exclusive research by Wipro and Utility Week into utilities' attitudes to innovation 27 | News Bulb announces third price rise this year Capping the end of an era Just like Christmas, we've all known for months that the energy price cap was coming. Yet even so, it feels odd that the biggest shake-up in the energy market since privatisation should pass by as one of the industry's least surprising milestone moments. When Ofgem's long-anticipated default retail tariff was eventually announced, the news was helped by the fact that the headline figure was £1,136, largely in line with market expectations. It seems, then, that the acid test will be what happens next. The regulator's proposal that from December suppliers will no longer be able to charge a typical dual-fuel standard variable tariff customer on a direct debit any more than this ceiling figure each year (a plan expected to benefit 11 million households by an average £75), marks the culmination of a long battle between government and industry, despite fierce opposition from retailers. Scheduled to be rubber-stamped in November and subject to ongoing review, many will recall the concept originally being kicked off in 2013 by then Labour leader Ed Miliband. Certainly, by the time Theresa May's pre-election pledge to get tough on "rip-off " energy suppliers finally took shape, the sector had long become resigned to the inevitable. But only time will tell if this deeply divisive market intervention was a wise development – let alone a successful one. One big six supplier's shares rallied in the aermath of the announcement, having eased worries about a possible dividend cut. However, vociferous warnings continue unabated from industry voices who call for "competition, not caps", and who caution against misplaced complacency about the effect the cap will have on switch- ing levels. Those same voices have also predicted that even more smaller players will now go to the wall. Earlier this year, when Business, Energy and Industrial Strategy (BEIS) committee chair Rachel Reeves called for the price cap, she reinforced her message by pointedly wagging her finger at energy bosses, saying they had only themselves to blame. But such condemnation can work both ways. Re-regulating a market, long characterised as broken and with increasingly squeezed margins, will turn out to be either a very brave or a very stupid political move. Suzanne Heneghan, acting editor, suzanneheneghan@fav-house.com Leader Suzanne Heneghan Talend: Sponsored Free Water Case Study: optimising water supplies https://bit.ly/2CEQQpf Knowledge worth Keeping Subscribers to Utility Week can access premium content and exclusive research, available to read online or as downloadable documents. http://www.utilityweek.co.uk/

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